Weekly Economic Report 6.13.25

It is hard to write analytically about the weak CPI or rising claims numbers when the world’s focus has shifted again to the Middle East, as Isreal has moved unilaterally to eliminate the threat of Iran’s nuclear threat. The primary effect on financial markets, as always, has been through sharply higher oil prices. After two months of prices in the low $60s following April 2nd’s Liberation Day and OPEC’s agreement to continue to pump, prices had been grinding higher to $66 – before jumping to $73.50 on Friday the thirteenth, then settling back slightly. With the Israeli attacks now including Iranian energy infrastructure, prices will remain high and volatile. Still, they are even now only slightly higher than pre-tariff levels, as oil prices ran around $70 most of the fourth quarter of 2024, then spiked in January before settling to $66 in March ahead of a rise into Liberation Day. The CPI price survey is taken in the week containing the 12th, so the pre-attack rebound to $66 will appear in next month’s CPI, likely in the 3% range for higher energy prices. The full impact of the new war will not show up until the report in August – another 5% if oil prices remain around $72.

EU06-13-2025.pdf

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